Future Investment Constraints Reduce Present Investment

d’Autume, Antoine; Michel, Philippe

doi:10.2307/1911732

Cited by 12 publications

(3 citation statements)

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“…Since the installation cost function is convex, cost minimization implies that expected future decreases in investment should be spread out over time. See D'Autume and Michel (1985) for a similar result. Because

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is measured in terms of market value, it should capitalize the above effects of any expected future constraints.…”

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confidence: 58%

Debt, Liquidity Constraints, and Corporate Investment: Evidence from Panel Data

Whited¹

1992

The Journal of Finance

1,001

345

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This paper presents evidence supporting the theory that problems of asymmetric information in debt markets affect financially unhealthy firms' ability to obtain outside finance and, consequently, their allocation of real investment expenditure over time. I test this hypothesis by estimating the Euler equation of an optimizing model of investment. Including the effect of a debt constraint greatly improves the Euler equation's performance in comparison to the standard specification. When the sample is split on the basis of two measures of financial distress, the standard Euler equation fits well for the a priori unconstrained groups, but is rejected for the others.

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{italicDAR}_{italicit}

is measured in terms of market value, it should capitalize the above effects of any expected future constraints.…”

mentioning

confidence: 58%

Debt, Liquidity Constraints, and Corporate Investment: Evidence from Panel Data

Whited¹

1992

The Journal of Finance

1,001

345

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“…Esta tipología de regímenes de desempleo en función del signo del exceso de demanda en cada uno de los mercados (bienes, trabajo) es expuesto en Malinvaud (1977). 30 Dado que estas dos teorías de equilibrios con precios fijos engloba los casos keynesiano y clásico, tal como lo pretendía hacer el modelo IS-LM y que esta teoría se propone reemplazar, sus promotores se designan como 29 Para una comparación de los diferentes tipos de desequilibrios, ver Benassy (1983), d'Autume (1985. 30 El desempleo keynesiano es caracterizado por un exceso de oferta en los dos mercados, y el desempleo clásico es caracterizado por un exceso de oferta de trabajo y un exceso de demanda de bienes.…”

Section: A De Los Equilibrios Con Precios Fijos a Las Rigideces Nomin...unclassified

La absorción de la macroeconomía por la microeconomía

Deleplace¹

2009

Lect. Econ.

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El objetivo de este artículo es comprender la tendencia dominante de la historia de la macroeconomía. Se trata entonces de identificar las dos vías que ha seguido la investigación de los fundamentos microeconómicos de la macroeconomía: de una parte la relación entre empleo, salario e inflación (vía señalada por Friedman) y, de otra parte, la existencia de rigideces o de una restricción monetaria (vía señalada por Clower). Palabras clave: Modelo IS-LM, Curva de Phillips, Restricción de Clower, equilibrios a precios fijos, rigideces nominales. Clasificación JEl: B20, E12, E13, E20, E30 Abstract: The aim of this article is to analyze the dominant tendency in the history of macroeconomics. It attempts to identify the two routes that research on the microeconomic foundations of macroeconomics has followed. On the one hand, the relation between employment, wages and inflation (the route indicated by Friedman); on the other hand, the existence of rigidities or a monetary restriction (the route indicated by Clower). Keywords: IS-LM model, Phillips. curve, constraint à la Clower, fixed prices equilibrium, nominal rigidities. JEL Classification: B20, E12, E13, E20, E30 Résumé : L'objectif de cet article est de comprendre la tendance dominante de l'histoire récente de la macroéconomie. Il s'agit alors d'identifier les deux voies qu.a suivies la recherche des fondements microéconomiques de la macroéconomie: d'une part la relation entre emploi, salaire et inflation (à la suite de Friedman) et, d'autre part, l'existence de rigidités ou d'une contrainte monétaire (à la suite de Clower). Mots Clef: Modèle IS-LM, courbe de Phillips, contrainte de Clower, équilibres à prix fixes, rigidities nominales. Classification JEL: B20, E12, E13, E20, E30

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“…Therefore, his contribution would have been part of an alternative approach to monetary theory allegedly embodied by Dennis H. Robertson (1933), Karl Brunner (1951), and Sho Chieh Tsiang (1966), and in which budget constraints were modified to account for the significance of money in transactions. The second interpretation of the 1967 article was expressed by D'Autume (1985) and De Boyer des Roches (2002). It asserted that the projects underlying the 1965 and 1967 articles rested on two logically distinct ideas: the "dual-decision" process and the circulation of money through the economy.…”

Section: Introductionmentioning

confidence: 99%

Disequilibrium as the Origin, Originality, and Ambivalences of Clower's Microfoundations of Monetary Theory

Plassard

2016

SSRN Journal

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Robert W. Clower's article "A Reconsideration of the Microfoundations of Monetary Theory" (1967) deeply influenced the course of modern monetary economics. On the one hand, it revealed the deadlocks of Don Patinkin's project to integrate monetary and Walrasian value theory. On the other hand, it was the fountainhead of the cash-in-advance models à la Robert J. Lucas (1980), one of the most widely used approaches to monetary theory since the 1980s. Despite this influence, there is no detailed study of Clower's (1967) project to integrate monetary and value theory. My paper aims to fill this gap. This is a difficult task since Clower never completed the monetary theory outlined in his 1967 article. To overcome this difficulty, I characterize the intellectual context from which Clower's (1967) contribution emerged and have recourse to a rational reconstruction of his project. This reconstruction is based on the analysis of published and unpublished materials, written by Clower before and after the 1967 article. Four conclusions are obtained. First, Clower (1967) intended to reorient Patinkin's program to integrate monetary and value theory. Second, this reorientation was prompted by Clower's (1965) influential search for disequilibrium microfoundations to Keynesian macroeconomics. Third, Clower's (1967) project was to formulate a disequilibrium monetary theory. Fourth, such a project failed because of Clower's (1965) approach to disequilibrium economics.

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Future Investment Constraints Reduce Present Investment

Cited by 12 publications

References 0 publications

Debt, Liquidity Constraints, and Corporate Investment: Evidence from Panel Data

Debt, Liquidity Constraints, and Corporate Investment: Evidence from Panel Data

La absorción de la macroeconomía por la microeconomía

Disequilibrium as the Origin, Originality, and Ambivalences of Clower's Microfoundations of Monetary Theory

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